Gold Price Starts Bidding War for Australian Mining Company

The gold price you see today may not be there next week. In Bloomberg’s weekly survey of analysts and gold traders, 72 per cent said that they thought that the price of gold would increase next week.

Gold is generally considered to be a good hedge against inflation and recession. George Soros was  reported to have doubled his holdings in gold back in February. Gold performed well last month, showing a gain of 5.6 per cent.

Now two giant Canadian gold mining companies are locked in a head to head battle to gain control of Australian mining company Andean. The attraction is Andean’s ownership of the Cerro Negro gold project in the Pategonia region of Argentina. The project is estimated to have a yield of 3.1 billion ounces of gold reserves.

The interest of the Canadian giants caused the miner’s shares to shoot up by 31% on the Sydney stock exchange last Friday. The exchange had to suspend dealings.

Goldcorp are reported to have bid £2.2 billion for the company and to have the support of both boards of directors. However their rivals Eldorado were the first to make a bid of £2.1 billion.

The Bloomberg survey has a record of 57 per cent accuracy over the 6 years during which it has been in operation.

Gold coin prices remain strong in a market where smaller investors continue to be very active.

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